What Is A Notice of Intent to Lien And Should You Send One?

The Notice of Intent to Lien is a mysterious document. While it is only required in a select few states, claimants all across the United States send this form. Even though a preliminary notice is required in most states, and a mechanics lien can be filed in all states, it’s the Notice of Intent to Lien that is perhaps our most popular filing at zlien.

This seems strange at first glance, but perfectly right upon further study, as this blog post discusses.

What Is A Notice Of Intent To Lien?

A notice of intent to lien is a lot like a demand letter. It is a form document sent to certain parties on a construction project warning that if payment isn’t made to the claimant within a certain number of days, the claimant will file a mechanics lien.

A few states require parties send a notice of intent to lien before they file a mechanics lien or bond claim. These states are:

The preliminary notice must be sent within a few days of when work begins, sometimes long before any amounts are owed or overdue on the project. The notice of intent to lien, on the other hand, is sent only after work is completed and payment is outstanding. It is delivered to a party immediately before filing a lien, usually 10 or 30 days before the filing.

Should You Send A Notice of Intent To Lien?

The short answer is that notices of intent to lien are frequently successful at producing payment, and may be worth sending. It’s a fraction of the cost you’ll spend on a mechanics lien or bond claim, and in many cases, it’s enough to nudge the parties to pay your claim.

If a party is refusing to pay your claim or ignoring your phone calls, sending a notice of intent to lien to that party, the prime contractor and/or the property owner will raise eyebrows. It will get the property owner breathing down your customers neck, and your debt will become a priority.

Sometimes, of course, a notice of intent to lien is not enough. Sometimes, it isn’t the “bringing more parties to the table” factor that is likely to get you paid, but some other effect of the mechanics lien. You’ll be in the best position to know whether the notice of intent to lien might work for you. Chances are, however, that it may.

Beware: Notices Of Intent To Lien Deliveries Can Be Dangerous

Unfortunately, I’ve seen many claimants lose their right to file a mechanics lien because of the notice of intent to lien, or rather, a misunderstanding about the notice of intent to lien.

You have to remember two key facts when you’re preparing to send a notice of intent to lien.

First, the notice of intent to lien will not delay or extend your mechanics lien deadline. If your deadline is in five days, you simply don’t have time to file a mechanics lien. If your deadline is twelve days away, you’re really close. You must, of course, send the notice of intent to lien if its required in the project’s state, so you have to squeeze it in. If you’re in a state that doesn’t require that notice, however, don’t take the risk. Or, at least, understand that the lien deadline will not budge.

About Scott Wolfe Jr

Scott Wolfe Jr. is the CEO of zlien, a company that provides software and services to help building material supply and construction companies reduce their credit risk and default receivables through the management of mechanics lien and bond claim compliance. He is also the founding author of the Construction Finance Journal, a leading online publication about liens, security instruments and getting paid on every account. Scott is a licensed attorney in six states with extensive experience in corporate credit management and collections law, with a specific emphasis on utilizing mechanic liens, UCC filings and other security instruments to protect and manage receivables. You can connect with him via Twitter,LinkedIn and Google+.

I am a receiving party of this in CA. Does the sender have a right to charge me ($125!) to mail me a letter? I received a very informal letter, a regular letter printed from a computer. Thanks for helping me and all the info you post on your page!

http://www.zlien.com/ Scott Wolfe Jr

Hi Nikki – thank you for reading and for your comment. Candidly, however, I’m not following your question. It sounds like someone is asking you to pay $125 in the letter? I’m not sure what you are referring to…